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Kodonomics
Kodonomics refers to the economic and budgetary policies enacted by the Yoko Kake Meguppātī party of Sekowo under the leadership of Kodos Fairname, following the elections of 3947. Kodonomics follows the principles of functional finance, and seeks to adjust the government's budget to either stimulate or slow down the economy, depending on the levels of unemployment and inflation. History of Kodonomics in Sekowo The initial enactment of Kodonomics in early 3948 involved nearly doubling government spending from 111,200,000,000 SEK to 213,497,778,107 SEK, while at the same time abolishing the previous 50% corporation tax and the 20% sales tax on essential goods and services. Progressive income taxes were enacted, with the lowest rates of 13% for incomes between 5,000 and 10,000 SEK, and up to 60% for incomes of greater than 75,000 SEK. In line with Yoko Kake Meguppātī ideology, spending on health and social services, education, science and technology, infrastructure, and the environment were particularly emphasized, while defence spending was reduced to 1% of GDP. Fairname described the reforms as: The government budget shall be roughly 40% of GDP. Due to the high unemployment, low inflation, and stagnating economy that resulted from the Fascist government's contractionary fiscal policy, for the time being we judge that a budget deficit of about 10% of GDP is warranted, in order to stimulate the economy and spur recovery. We shall introduce tax reforms with the aim of setting taxes at about 30% of GDP. As the economy recovers, taxes will naturally increase somewhat - and then it will be necessary to revise budgetary policy with an eye towards maintaining a budget suited towards the present level of unemployment and inflation. By early 3948, Sekowo's GDP had grown dramatically from about 500,000,000,000 SEK to 606,933,773,980 SEK as the result of the introduction of Kodonomics. As a result of this growth, the budget deficit dropped from 10% to 7.5% of GDP. But as the years wore on, the Yoko Kake Meguppātī continued to expand Kodonomic policies, leading to ever more government spending, ever lower taxes, ever higher budget deficits, and ever higher GDP. By 3962, government spending had risen to 902,760,843,760 SEK, while the sales tax, the luxury goods tax, and the corporation tax had all been completely abolished. Only the progressive income tax, to the tune of 91,400,776,098 SEK, remained. This meant a government deficit of 811,360,067,662 SEK. As a result, GDP stood at 1,364,555,313,560 SEK. But despite this, unemployment remained very high throughout much of Sekowo.The economic model in the game does not work. Although incomes went up, and although Sekowans owned more and more financial wealth in the form of government bonds, consumption went up by very little. Sekowans seemed to want to accumulate more and more safe assets, without ever increasing their spending. The government responded with a series of drastic measures, including cutting the retirement age to 45 to spread out the work more evenly among workers. Some blamed Sekowo's increasing use of robots in production for the high unemployment even while GDP soared. Others said that Sekowo had entered a period of secular stagnation. Criticisms of Kodonomics The National Conservative Party became critical of Kodonomics, arguing that Sekowo should adopt Capitalism instead. However, the Yoko Kake Meguppātī argued that Kodonomics was compatible with Capitalism.